DISTRICT CONSUMER DISPUTES REDRESSAL FORUM. BOLANGIR.
……………………………
Presents:-
- Sri P.Samantara, President.
- Sri G.K.Rath, Member.
- Smt. S.Rath, Member.
Dated, Bolangir the 30th day of November 2016.
C.C.No. 74 of 2014.
Mamata Jain, aged about 35 years wife of late Kamal Kishore Jain.
Resident of Main Road, Patnagarh, P.O/P.S-Patnagarh, Dist.-Bolangir.
.. .. .. Complainant.
-Versus-
1.Magma Finance Corp.Limited, At-K-Mart Building, Khadalpada
Bolangir Town, P.O/P.S/Dist- Bolangir.
2.Magma Fin Corp. Limited, 1st Floor Balaji Midtown, Dehripali Chhak,
Budharaja Para, Sambalpur, Odisha.
3.Magma Finance Corp. Limited, Magma House-24, Part Street,
Kolkota W.B.-700016.
4.Kotak Mahindra Old Mutual Life Insurance Limited,
2nd Floor, Radhika Complex, Cuttack Road, Jharapada,
Bhubaneswar-751006.
5.Kotak Mahindra Old Mutual Life Insurance Limited
7th Floor,Kotak Infiniti Building No.21Infinity Park, Off.W.E.
Highway General A.K.Vaidya Marg, Malad (E),Mumbai-
400097, India.
.. .. .. Opp.Parties.
Adv.for the complainant- Sri A.K.Mishra & Associates.
Adv. for O.Ps 1 to 3 - Sri B.S.Satpathy.
Adv.for O.Ps 4 & 5 - Sri P.K.Das & S.S.Deo.
Date of filing of the case- 21.10.2014
Date of order :- 30.11.2016 -
JUDGMENT.
Sri P.Samantara, President.
1. Succinctly put, complainant is a nominee under policy Kotak Group Assure (Policy No.GA 000035) Product No.UIN: 107N051V02 issued vide certificate No-GA 0000354011300 relating to loan ID: PG/0174/C/12/000032, disbursed by Magma Finance Corporation Ltd.
2. Averred loan was financed in purchase of vehicle No.Regd..OD-03A-2728, payable in 35 consecutively monthly installments. The finance amount is Rs 4,60,129/-.
3. It is stated the complainant died on dt.04.09.2013 and as per the KOTAK GROUP ASSURE customized policy the life assured under the group Insurance covered for an amount of Rs 4,40,000/- and to be indemnified subject to maximum loan outstanding amount as per cover schedule and any excess, shall be released to the policy holder or in favour of Nominee member as declared and provided in the Member Date/Declaration of Good Health (DOGH) cum membership for that have been executed.
4. Post demise of the member named Kamal Kishore Jain, the nominee claimed the cover benefit under the policy contract in securing the repayment of loan which is repudiated on the ground stating “unable to consider the said claim on account of non disclosure of material information” intentionally on 20th March 2014. Thus made the case in praying the considered indemnification benefit along with reliefs deem fit and placed reliance on photo copy of policy, letters and affidavit.
5. The complaint is contested by O.Ps arrayed in 1,2,3 and 4 & 5 in a singled representation. O.Ps filed their version in admission and vehement contention.
6. O.Ps 1,2 and 3 in admission stated the vehicle in question financed by this O.P. The financier has absolute right to repossess the vehicle in view of default in payment. Also contended the financier is not liable to pay any compensation. The O.P is being the financer is not liable to insure the vehicle. It is the responsibility of the owner of the vehicle to insure. The allegations are not sustainable being based upon concoction, frivolous and malicious & mischievous in nature.
7. Further submitted because of settled principle that when a complaint can not be decided by the consumer forum after an arbitration award is already passed in the present case, the arbitration award has been passed on dated 01.07.2014,so the complaint is not maintainable in view of catena of judgment passed and relied with. Under facts and circumstances pleaded same be dismissed.
8. In pursuant to notice, Kotak Mahindra Old Mutual Life Insurance Co. Ltd. ( herein after known) O.Ps 4 and 5 admitted subject policy was issued on 30.05.2013 and cover terminated on dated 29.05.2016 but contended the Insurance contract was based i.e principle of Uberri-mafides. The member has to maintain and observe complete good faith but revealed the sole obligation has been breached as the member has failed to disclose that he was diagnosed with cirrhosis of liver doecompensated ascites coagulopathy prior to signing the declaration of good health. So the said intentional non disclosure of the material fact at proposal stage clearly indicates, the subject policy has been obtained fraudulently, dishonestly and by misrepresentation.
9. Also made submission in accordance with clause 6(2) of IRDA Regulation 2002 being not satisfied can withdraw/return the policy within 15 days and had the member disclosed his post medical history, the company would not have issued the policy to the member inter alia the forum has no jurisdiction, the subject matter is void-ab-initio and not maintainable being liable to be dismissed under section 26 of the Consumer Protection Act.
10. We have heard arguments advanced at bar and have perused the record.
11. The O.Ps counsels heavily contended the maintainability of the complaint.
On the outset we found the complainant is the nominee of the deceased policy assured, whereas the deceased is the beneficiary under the same policy and the policy holder is “Magma Fin Corp. Ltd”. So under Consumer Protection Act, under section 2(d)(ii) which spells:-
“Hires or avails of any services…………………includes any beneficiary of such services………………when such services are availed of with the approval of the first mentioned person……………which is mandatory provision in assuming as a consumer which is not obtained from the policy holder by the nominee. On this score of the provision of the locus standi of a consumer is at stake and made fatal.
12. Further, it is observed as per the expressed terms and conditions of the finance agreement, in default of payment, reference to Arbitration can’t e ruled out. Lastly on dt.01.07.2014 L’d arbitrator has passed award, which commenced on 24th April 2014 and culminated in 1st July 2014, which is consecutively intimated to made appearance and stand to defence-Consequent to same the award has been passed, published and delivered whereas the complainant dissuade away from the reference proceeding and filed a consumer complaint on 21.10.2014 being with knowledge.
13. Further to say, the questions whether that award is legally maintainable or not or whether findings recorded in the award are liable to be confirmed or not are such type of questions which could only be decided by that authority before whom that award would be challenged and not before the District Forum. Therefore, the law laid down by the Hon’ble National Commission in the case Juliet V.Quadros Vs Mas.Malti Kumar and Ors. (2005(2) CPR 1 (NC) and by the Bihar State Commission in the case of Tata Finance Ltd. Vs. Panchanand Ojha (2005(1) CPR 360) would not come to help to the complainant, respondent as in both cases it was held that in spite of the Arbitration clause the District Forum had jurisdiction to try the complaint but in the present case the award had been passed by the Arbitrator prior to filing of the complaint before District Forum. Even if the proceedings before the arbitrator had taken exparte, the exparte order still holds good unless and until the same is set aside by the competent authority and the authority is not the District Forum but the authorities are which are provided in the Arbitration Act,1996.
14. It may further be stated here that since a specific section 34 has been provided in the Arbitration Act,1996 for setting aside the arbitratory award and if the complainant had any grievance, he should take recourse under the provisions of Arbitration Act,1996. For such reasons decreeing the claim wholly would be illegal, erroneous and perverse one. Every O.Ps not specifically raised the issue the complainant has not come with clean hands. Above all when arbitration award has been passed which is binding on the parties? The complaint is barred by resjudicata in as much as concealed from this Forum.
15. The award passed by the Arbitrator can only be set aside under section 34 of the Arbitration and conciliation Act 1996 before the competent court for setting aside the award passed by the Arbitrator, the award passed by the Arbitrator has attended finality and is binding on the complainant.
16. We prefer to place reliance on Hon’ble National Commission decision (1) The installment supply Ltd Vs Kangra Ex-serviceman Transport Co. & Anr- Held – where an award had been passed by the Arbitrator, in such a case no complaint could be filed before the District Forum and the District Forum could not entertain that complaint and should not pass the order overlooking the terms of award (ii) And after award passed by Arbitrator Consumer Forum cannot decide complaint- HDFC Bank Ltd Vs Yarlagadda Krishna Murthy-2013(1) CPR 129 (A.P).
From these points of views being barred of jurisdiction, the case stands dismissed.
Copy of the order be made available to the parties as per rule.
File be consigned to record room.
(P.Samantara)
PRESIDENT
Sri G.K.Rath, Member.
Perusing the complaint petition, pleadings of both parties and the documents available in the case record, I am not agree with the order passed by learned President, for the following reasons.
1. In this case the loanee Kamal Kishore Jain, died on 04.09.2013 but the arbitration case started by Magma Finance Corp Limited on dt.25.3.2014, as per the file No.ARB090578 which means the Arbitration dispute has been filed and decided against a deceased person and intimated the same on dated 1.7.2014 to the deceased Kamal Kishore Jain.
2. That loan financed against deceased Kamal Kishore Jain, by Magma Finance Corp Limited and the said Magma Finance Corp Limited insured the life of deceased Kamal Kishore Jain, with Kotak Mahindra Old Mutual Life Insurance Limited, wherein the complainant in the present case is the nominee but in the Arbitration dispute, the aforesaid Insurance Company (Kotak Mahindra)and the nominee the present complainant have not been made necessary parties by the Magma Finance Corp Limited for just and proper decision of the Arbitration dispute. As per law the Magma Finance Co.Ltd should have made the legal heirs (Nominee) of the deceased Kamal Kishore Jain as a necessary party within 90 days from the date of death of the deceased. In the Arbitration dispute the Magma Finance Co.Ltd has failed to made parties to the legal heirs (Nominee) of the deceased within the prescribed period. Hence the case is abated as against that deceased Kamal Kishore Jain, therefore the award passed by the Arbitrator is not binding on the complainant.
3. In the present case the complaint has been filed by the nominee of the deceased Kamal Kishore Jain and in the Arbitration dispute the deceased Kamal Kishore Jain was the party so it is not coming under the provision of Resjudicata since the parties in both the cases are not similar.
4. The nominee Mamata Jain is a consumer in the present case since she is a beneficiary of service with the approval of the deceased policy holder for getting the benefit after death of the policy holder, as per Sec.2(1)(d) of C.P.Act. Hence the present complainant (nominee of deceased Kamal Kishore Jain) has full right to file the present complaint on the death of his deceased husband as a consumer.
5. That the citations relied on by the learned President, are not similar to the facts and circumstances of the present case since no where the citations reveal that award has been passed by the Arbitrator against a deceased person.
6. It is the admitted fact that the late husband of the complainant had purchased the vehicle bearing Regd. No.OD-03A-2728 under hire purchase scheme obtaining loan from O.Ps1 to 3. The late husband of the complainant had insured his life with O.Ps 4 and 5, through O.Ps 1 to 3 vide insurance Policy No.GA000035, to indemnify the loan amount in case of his death. The insurance policy was valid from 30.5.2013 till 29.5.2016 and during subsisting of the policy the husband of the complainant died on 04.09.2013 and till then he had paid only 3 installments.
7. The main thrust of allegation of O.Ps 4 and 5 is that the deceased husband of the complainant failed to disclose that he was diagnosed with cirrhosis of liver decompensated ascites coagulopathy prior to signing the declaration of good health and u/s.45 of Insurance Act,1938 they can challenge the policy on the ground of concealment of material fact by the insured and accordingly repudiated the claim. My opinion is that at the time of signing the declaration of good health and the declaration of good health certificate is signed by the own appointed doctor of the Insurance Company after testing or checking up the health condition of the deceased insured during the time of accepting the insurance policy. The O.Ps 4 and 5, in support of their claim, have not filed any document to prove that the insured had concealed material fact regarding to his health nor filed any affidavit evidence to the same. So, when the declaration of good health certificate is signed by their own doctor, while accepting the policy, and after acceptance of the policy during the life time of the deceased, they have not raised such question, they can not raise such a question after the death of the insured Kamal Kishoe Jain and deny their liability to make payment of the up to date unpaid loan amount of the life assured under the policy. Hence I opine that;-
8. The present complainant is a consumer under the provisions of the C.P. Act and she being the legal heir of the deceased insured, has filed the case within the limitation period.
9. The O.Ps are carrying their business having a branch office at Bolangir, so the present forum has jurisdiction to entertain the complaint.
10. The present case is maintainable in this forum since in Arbitration dispute the fact or issue has not been decided between the same parties and for the same cause of action. In arbitration dispute the Magma Co.Ltd has made the deceased insured Kamal Kishore Jain as party without substituting his legal heirs after his death, so the dispute filed and decided by the Arbitrator is not maintainable in the eye of law.
11. The deceased insured had purchased the vehicle by obtaining loan from O.Ps 1 to 3 and his life was insured with O.Ps 4 and 5 through O.Ps 1 to 3 vide policy No.GA000035 to indemnify the loan amount in case of his death. The insurance policy was valid at the time of death of the deceased where the deceased insured had paid 3 only installments and died.
Therefore, in view of my above opinion, the O.Ps 4 and 5 are liable to indemnify the balance loan amount of the insured deceased Kamal Kishore Jain. Accordingly I direct O.Ps 1 to 3, to collect the upto date unpaid loan amount of the insured loanee from O.Ps 4 and 5. Further the O.Ps are hereby restrained to snatch way the financed vehicle of deceased Kamal Kishore Jain from the possession of the complainant.
I agree.
(S.Rath) (G.K.Rath)
MEMBER. MEMBER.
